Death of Venture Capital

what is real will prosper

There is a growing class of founders building companies not out of inspiration, nor out of survival, but out of desperation for status. The struggle to attain high-flying jobs pushes those people toward entrepreneurship as a default rather than a calling. To them, the startup becomes a vehicle to secure funding, avoid gaps in employment, and access the social prestige that now comes with being a “founder”. There is nothing inherently wrong with being motivated by money. The problem arises when the performance of entrepreneurship replaces the practice of building.

This behaviour mirrors the tension George Soros described between the cognitive function (understanding the world) and the manipulative function (changing the world). Earnest founders begin with the cognitive: they obsessively observe a reality others miss. The performative founder skips this step entirely. Driven by status, they engage purely in the manipulative function, attempting to force a narrative onto the market without the friction of truth. They are not building a company; they are managing a perception. When perception becomes the product, the company becomes hollow, filled with noise rather than signal.

The companies of great founders emerged from problems that they felt compelled to solve. Their obsession acts as a compass when the money runs out or the market turns. Characteristics like authentic conviction cannot be manufactured through playbooks, accelerators, or motivational speeches. Outlier founders, like outlier ideas, must be discovered. Venture capital can only accelerate those who already have fire in their eyes; it can support flames, it cannot spark them.

Startups used to be the domain of outsiders; their position on the fringe allowed them to see possibilities that insiders were structurally blind to. It was not considered prestigious to go against the tide; it was simply the only path that made sense. Today, the industrialisation of the startup ecosystem has inverted this. The internet and the proliferation of VC have turned what was once a countercultural activity into a spectacle. Dropping out of university is now flaunted as a credential rather than a sacrifice; raising money is celebrated as an exit rather than the start of an obligation.

This is the paradox of startups and venture capital. The industry that was designed to fund experimentation has, through its own success, shifted toward standardisation. It has fallen victim to Goodhart’s Law: by creating clear metrics for what a “fundable” company looks like, it created a class of “founders” who optimise for the metrics rather than the reality. Investors rely on pattern matching to minimise risk; founders seek validation to extend runway. Both sides cyclically extract from one another. This leaves a loop where people perform more and build less.

I know this trap personally. I dropped out of school at 17, convinced that entrepreneurship was the ultimate path to sovereignty. I had hunger, yet I lacked a compass. I mistook the signifiers of success for success itself. I told myself I was inspired; in reality, I was mimetic: copying the external behaviours of what it means to be a “founder” without yet possessing the internal conviction that drove them. I focused on the aesthetics of success rather than the fundamentals of value creation. Proving others wrong can be a powerful fuel, yet it burns dirty; the energy of genuine curiosity is necessary to sustain growth.

Years later, I was offered $500k in funding to build a crypto project and politely declined. The money was real and the market was hot, but my conviction was not. Without conviction or a problem worth solving, the idea felt lifeless. Capital alone cannot manufacture urgency. The moment one builds only because capital is available, innovation dies. If I create, it is because I am compelled to, not because the money exists.

A durable company starts by asking fundamental questions that shape its direction. A fragile company shapes its mission to fit the capital by asking: “What is currently fundable?” Making money is necessary, though it is a lagging indicator of value, and a weak compass for navigating the unknown. The talented builders I know hate participating in an environment surrounded by performative behaviour and faux prestige.

The ones who see through the mirage and focus on the work will be the ones building the future.